PERSONAL & BUSINESS SOLUTIONS
Wasiat
Wasiat
Wasiat is a declaration made by a person during their lifetime on how to distribute their property or benefits, for charity or any other purposes permissible by Islamic Law, after their death. Without Wasiat, the assets of Muslims who die shall be divided rigidly amongst their heirs following the Faraid (the Islamic Law of Inheritance).
A Muslim is obliged to make a wasiat, dispensing one-third of their assets to those not eligible for Faraid such as adopted children or any other party, be they Muslims or not, or to charity so long it is done per the Syariah.
This way, you ensure your assets are distributed according to your wishes and in line with Islamic inheritance laws while guaranteeing the survival and wellbeing of those you deem to be deserving. This helps prevent potential disputes or conflicts among family members and ensures that your assets are allocated fairly and appropriately.
The benefits of making wasiat are:
- Ensuring smooth execution of the asset distribution
- Appointing a Wasi to inform, oversee, and facilitate the distribution of assets according to the Wasiat stipulations can ensure that your wishes are carried out without any deviations.
- Ensuring the fulfilment of religious obligations
- Allocates a portion of your assets to fulfil religious obligations such as paying off outstanding debts (including spiritual debts such as Hajj, zakat, and fidyah), fulfilling charitable obligations (sadaqah jariah), or donating to religious institutions.
- Distribution of assets according to Islamic principles
- Allows you to distribute your assets among your heirs following Islamic inheritance laws (Faraid or Muafakat). It ensures that your assets are divided fairly, considering the rights and shares of each eligible heir.
- Minimising disputes and conflicts
- A clear and comprehensive wasiat can help minimize disputes and conflicts among family members by specifying how your assets should be distributed. It provides clarity and reduces the potential for disagreements, ensuring a smoother transition of assets.
- Protecting the rights of vulnerable individuals
- Protects the rights and interests of vulnerable individuals such as minors, individuals with special needs, or elderly family members who may require ongoing care and support.
Let’s bear in mind what the Prophet S.A.W. said, as narrated by Abdullah bin Umar:
“It is not permissible for any Muslim who has something to will to stay for two nights without having his last will and testament written and kept ready with him.”
Hibah
Hibah
- Fixed assets, e.g., house, land
- Liquid assets, e.g., shares, unit trust investments
The five requirements of hibah are:
- An akad (contract) granting property ownership to a specific party
- The property to be given as hibah is a physical property and not debt
- Hibah contract is made without imposing any reprisal
- Hibah contract is in effect during the lifetime of the hibah provider
- Hibah is made voluntarily, and the contract is made with no intention to receive reward or honour a particular person.
The benefits of making hibah are:
- Immediate transfer of ownership (Hibah Mutlak)
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- Allows for the immediate transfer of ownership of assets to the recipient during your lifetime. It allows you to gift your assets to individuals or organisations, providing them with immediate benefits and support.
- Allowing for conditional Hibah
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- Allowing the asset transfer only after your passing where the documentation can be done during your lifetime, but the ownership takes effect upon your death.
- Avoiding probate
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- Unlike assets passed through a will, assets transferred through hibah do not go through the probate process after your passing. This can help expedite the transfer of assets and minimise administrative burdens.
- Expressing gratitude and strengthening relationships
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- Offers an opportunity to express gratitude and strengthen relationships with loved ones by giving them gifts during your lifetime. It allows you to share your wealth and resources with family members, friends, or deserving individuals while still alive.
- Obtaining blessings and rewards
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- In Islam, giving gifts (hibah) is considered a virtuous act. By engaging in hibah, you can seek blessings and rewards from Allah, fostering a sense of spiritual fulfilment.